Volkswagen offers early retirement to 2,300 workers in two of its factories in India
Employees who opt for the scheme will get 75 days’ pay for each year served or left until retirement, whichever is less.
- Dec 11, 2025,
- Updated Dec 11, 2025 4:22 PM IST
Volkswagen Group has offered early retirement to all 2,300 workers at its two factories in India. The move aims to tackle challenges in growing its share in India’s automotive market, where it holds about 2 per cent despite over 20 years of presence.
The scheme targets blue-collar staff at the Maharashtra factories, which produce vehicles like the Skoda Kushaq SUV, Volkswagen Virtus sedan, and Audi Q3 and Q5 for both domestic and export markets. Both plants are running below capacity. The offer seeks to optimise manpower and match workforce size with current needs.
"Based on requests and constructive discussions with the Union over the past couple of years at both our manufacturing locations (Pune and CSN), SAVWIPL has introduced a Voluntary Retirement Scheme (VRS) to support employees who are considering retirement or exploring other career opportunities. The scheme is entirely voluntary, underscoring our commitment to employee welfare and social responsibility. Through these and many other initiatives we are strengthening operational efficiency and reaffirming our long-term commitment to the Indian market," said a company spokesperson.
The spokesperson said that volumes grew about 38 per cent year-on-year in 2025, propelled by the Kylaq in the sub-4m category. "A series of new model introductions across our six brands have increased our market share, and ongoing initiatives are set to strengthen our position in this strategic market further," the company said.
Employees who opt for the scheme will get 75 days’ pay for each year served or left until retirement, whichever is less. Those who accept within five to ten days will receive an additional payout.
A source told Reuters that the company wants to "rationalise manpower and align it with current needs," adding that Volkswagen intends to "continue paying competitive wages and keep the plants operational." The early retirement is voluntary and was introduced at the request of worker unions.
Skoda Auto Volkswagen, leading the group’s India strategy since 2018 and seeking a local partner for future investments, confirmed the scheme was union-requested. The group is also contesting a $1.4 billion import tax demand, which it denies.
Volkswagen continues to sell brands like Skoda, Volkswagen, Audi, Porsche, Lamborghini, and Bentley in India but has not significantly increased its market share. Skoda stated the restructuring aims to strengthen the business and "reaffirm our long-term commitment to India," while seeking further investment and local partnerships for growth.
Volkswagen Group has offered early retirement to all 2,300 workers at its two factories in India. The move aims to tackle challenges in growing its share in India’s automotive market, where it holds about 2 per cent despite over 20 years of presence.
The scheme targets blue-collar staff at the Maharashtra factories, which produce vehicles like the Skoda Kushaq SUV, Volkswagen Virtus sedan, and Audi Q3 and Q5 for both domestic and export markets. Both plants are running below capacity. The offer seeks to optimise manpower and match workforce size with current needs.
"Based on requests and constructive discussions with the Union over the past couple of years at both our manufacturing locations (Pune and CSN), SAVWIPL has introduced a Voluntary Retirement Scheme (VRS) to support employees who are considering retirement or exploring other career opportunities. The scheme is entirely voluntary, underscoring our commitment to employee welfare and social responsibility. Through these and many other initiatives we are strengthening operational efficiency and reaffirming our long-term commitment to the Indian market," said a company spokesperson.
The spokesperson said that volumes grew about 38 per cent year-on-year in 2025, propelled by the Kylaq in the sub-4m category. "A series of new model introductions across our six brands have increased our market share, and ongoing initiatives are set to strengthen our position in this strategic market further," the company said.
Employees who opt for the scheme will get 75 days’ pay for each year served or left until retirement, whichever is less. Those who accept within five to ten days will receive an additional payout.
A source told Reuters that the company wants to "rationalise manpower and align it with current needs," adding that Volkswagen intends to "continue paying competitive wages and keep the plants operational." The early retirement is voluntary and was introduced at the request of worker unions.
Skoda Auto Volkswagen, leading the group’s India strategy since 2018 and seeking a local partner for future investments, confirmed the scheme was union-requested. The group is also contesting a $1.4 billion import tax demand, which it denies.
Volkswagen continues to sell brands like Skoda, Volkswagen, Audi, Porsche, Lamborghini, and Bentley in India but has not significantly increased its market share. Skoda stated the restructuring aims to strengthen the business and "reaffirm our long-term commitment to India," while seeking further investment and local partnerships for growth.